Financial emergency declared in Detroit

DETROIT -- Citing runaway deficits and long-term debts Detroit could never repay on its own, Michigan Gov. Rick Snyder on Friday pulled the trigger and announced he will appoint an emergency financial manager for the state's largest city. Snyder said he has a candidate in mind, and that person would be in charge for 18 months.

The decision means Motown will soon have a new boss in charge of restructuring its dire financial mess. That restructuring likely will include drastic cuts in public services and a rethinking of the type of government a shrunken city with a dwindling tax base can afford.

In many ways, those questions have been nipping at Detroit for decades, but the issues came to a head over the past 18 months as increasingly dour economic forecasts found a city unable to address fundamental questions about its debt.

"I look at today as a sad day, a day I wish had never happened in the history of Detroit, but also a day of optimism and promise," Snyder said.

He reiterated that Detroit, once among the most prosperous cities in the nation, "went from the top to the bottom over the last 50 years," losing more than half its population.

Snyder said he will not name the emergency manager right away.

Detroit Mayor Dave Bing said he "did not favor" an emergency manager.

"The governor has made his decision, and it was his decision alone to make," Bing said in a statement. "While I respect it, I have said all along that I do not favor an emergency manager for the city of Detroit."

Snyder was flanked on stage by signs saying "Detroit can't wait" and conveyed a message that Detroit -- with $14 billion in long-term bond debt and retiree pension and health care benefits and a $327 million accumulated deficit -- has to fix its finances.

He declared the city in a financial emergency and said it's time to work toward "a bright and shiny future" for Detroit.